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JAKE TAPPER, CNN HOST: Welcome back to THE LEAD. I'm Jake Tapper.

Any moment now, we are expecting House majority leader Eric Cantor to come before the cameras for his first comments since his concession to David Brat, a libertarian economics professor with next to no cash, name recognition or experience in politics who just bested the seven- term congressman in a historic primary upset.

Dana Bash live at the Capitol, just feet from where Cantor is about to speak. Cantor is expected to be stepping down from leadership as House majority leader at the end of the July. Dana, what does he do now?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, before I get to that, I will tell you, we have a little bit of news from a Republican leadership source that the election to fill his slot and possibly other slots, if there's a domino effect, will be one week from tomorrow. So, that would be next Thursday.

And that's interesting for one really big reason, which is that the thinking in the parlor games of this House Republican leadership election is that the man who wants the job, House majority whip Kevin McCarthy, who's now the No. 3, has a better chance at getting that if this happens quickly, if there aren't more people who can jump in and lobby the rank and file to get that job. He will have some competition, but that's -- that's when this is going to happen.

The other thing that I can tell you is that he formally announced to his caucus what we have been reporting all afternoon, which is that he will step down effective July 31. He will stay in Congress through the rest of his term but he will not be majority leader as of July 31. And just anecdotally, we heard several rounds of wild applause from within the room while he was speaking to his conference. It was probably a half hour long. Most people have now left, and we are just waiting for Eric Cantor to come out.

TAPPER: Dana Bash, presumably Congressman Cantor is going to stay in office until his term ends, either in December of this year or January of next. Why step down as House majority leader? Why not ride that horse all the way to the end of the race?

BASH: You know, it'll be interesting to see what he says. I will tell you what my sources have said to me, which is there are a couple of reasons. No. 1 is, you know, he feels that there was clearly a message sent, and to stay longer would be disruptive to the House caucus, especially as they're trying to unite little by little as they try do well and best Democrats in November.

Another reason is because there was concern, I was told, that if he didn't step down and there was a revolution, there were people within the caucus who wanted to get him to go immediately, they could call for wider leadership elections, and that could jeopardize House speaker John Boehner. It would just make it more difficult for him because it would mean there would be a whole slate of leaders that would have to be re-elected. So those are some of the reasons I was told are possibilities that he decided to do this now.

TAPPER: While we wait for House majority leader Eric Cantor to come out and talk to the country, let's bring in our political panel for a little Cantor banter. The chairman -- chairwoman of the Tea Party Patriots Citizens Fund, Jenny Beth Martin joins us. Also CNN political commentator and columnist for "The New York Times," Ross Douthat.

Jenny, let me start with you. The national Tea Party groups didn't give David Brat any money. Why not?

JENNY BETH MARTIN, CHAIR, TEA PARTY PATRIOTS CITIZENS FUND: Well, Tea Party Patriots Citizens Fund did not endorse in this race. We were focused on other places, such as Mississippi, where we spent over $700,000 --

TAPPER: To get rid of Senator Ted Cochran for --

MARTIN: That's correct. Now with that said, the local groups and the local grassroots individual activists in the district are the ones who did this. They're the ones who supported Brat and went door to door and made this happen. It's their victory. And I'm very proud of them.

TAPPER: How much is it their victory and how much do you think, Ross, that it's Eric Cantor's loss?

ROSS DOUTHAT, "THE NEW YORK TIMES": Oh, I think it's their victory. I mean, I think that this is, you know, we're having this conversation about whether it's a real Tea Party upset or not because of the national groups not being involved. But ultimately, it's sort of the most authentic kind of Tea Party --

TAPPER: Sure. Grassroots, not from Washington, right.

DOUTHAT: It's true grassroots. And obviously it was made possible by factors sort of particular to Eric Cantor. But it happened because of the grassroots, first and foremost.

TAPPER: What is the problem that Tea Party activists have with Congressman Cantor?

MARTIN: When you -- when you see polling from around the country and when you talk to people, you know they're concerned about the economy. They're concerned because we have the fewest number of Americans working in the workforce today, fewer than we have had in decades. We're $17 trillion in debt, $58,000 per individual in this country.

TAPPER: You don't think that people voted for David Brat because they thought Eric Cantor was --

MARTIN: These are issues people care about, what is it that the House leadership is focused on? Increasing the debt ceiling, passing amnesty, ignoring the will of the people, and doing the things that they think are going to protect themselves rather than doing what the people back home in the districts care about. That's what motivated the people in Virginia, and that's what's motivating people in Mississippi and other places around the country.

TAPPER: We should point out, though, it's not what motivated voters in South Carolina last night where Senator Lindsey Graham won handily over a slate of more conservative candidates, and he's the author of immigration reform.

DOUTHAT: This is why it is, you know, I have -- having just said it's about the grassroots, it's obviously also about Eric Cantor's failure to do the most basic task in politics. And Lindsey Graham, from the beginning of that campaign, was very focused, intent on keeping his opposition divided, focusing on his constituents in South Carolina. And I think that consensus is that Cantor, in his role in the leadership, lost touch with his district, to some extent, in ways that made it possible for this to essentially sneak up on him. Though it obviously snuck on everyone. Nobody in the media was predicting this.

TAPPER: It snuck up on Professor Brat. He didn't know he was going to win.

DOUTHAT: In the last few days of the election, from Friday until Tuesday, I was getting e-mails from activists on the ground saying, we think we can win this. And so they weren't completely surprised. They could feel momentum, and they saw and heard what they were doing as they went door to door and made the phone calls. It's a grassroots victory, and it's a victory in the principles we care about: personal freedom and economic freedom in a debt-free future.

TAPPER: Let's go to Dana Bash just for one second in the room there, who has some reporting on what House speaker John Boehner just said in that closed door meeting with his Republican colleagues. Dana, what do you have?

BASH: That's right. It was behind closed door, but was House speaker John Boehner's aides want us know what he said to Eric Cantor and to his colleagues. And this comes from a source who got information from Deidra Walsh. And it looks pretty heartfelt. Boehner talking about being elected majority leader himself eight-and-a-half years ago, and Eric Cantor being there as his chief deputy whip, saying he's always been there. No one worked harder or puts more thought into advancing our principles. He also went on to quote Winston Churchhill, saying, "Success is not final, failure is not fatal. It's the courage to continue that counts."

He also, Jake, you remember this, you covered this: John Boehner himself was defeated in 1998, not from his seat, but from the leadership. And so he knows what it's like to leave and to not leave of your own volition. He said that and also saluted Eric Cantor and his amazing staff.

So, it's a very nice speech. Very heartfelt. As he said at the beginning, not one he expected to give.

TAPPER: Of course it's a complicated relationship, the House speaker, John Boehner, and House majority leader -- soon-to-be ex leader, Eric Cantor -- because a lot of whispers of Cantor wanting to unseat him at some point, et cetera. Looks like the photographers are ready to take some pictures. We got the two-minute warning a few seconds ago. Dana, do you want to say something?

BASH: Yes, it is a complicated relationship, but it's become less complicated I would say over the past year, year-and-a-half or so. The vetting folks here were -- have been thinking that John Boehner would likely retire after this term. And nobody really disputed that hard in whispers. And Eric Cantor was really pretty actively in his staff, pretty actively preparing to succeed him. And John Boehner was fine with that.

In fact, last night, when this all broke, one of the first things I was told by people who are familiar with Boehner's thinking, it might be less likely to retire now because he wants to make sure that the conference, the Republican conference isn't thrown into major chaos, that he has a successor that is going to be able to handle this.

TAPPER: He doesn't know who his No. 2's going to be.

BASH: Exactly.

TAPPER: Jenny, but who would you like to see as the next House majority leader, if you don't mind my asking?

MARTIN: I am not positive right now. We're moving through it. I've been getting e-mails from people around the country today. I know that we've heard several different names mentioned, and I don't think that people in the movement want to see anyone who is currently in leadership move into that role.

TAPPER: Is that right? Because Ross Douthat, the House majority whip, Congressman Kevin McCarthy, from California, is somebody who has good relations with members. But he might be eyed wearily by the groups.

DOUTHAT: I mean, everyone thinks he has the inside track. I think there would be an irony here in that Cantor lost in part, we think, because he was perceived as too soft on immigration. From everything we know, McCarthy is much more enthusiastic about a comprehensive immigration proposal than Cantor ever was, that within leadership --

TAPPER: Here he is right now. Let's listen to House majority leader, Eric Cantor. REP. ERIC CANTOR (R-VA), HOUSE MAJORITY LEADER: Good afternoon. First

of all, I just want to talk a little bit about what happened last night and then going forward.

You know, growing up in the Jewish faith, you know, I grew up, went to Hebrew school, read a lot in the Old Testament. And you learn a lot about individual setbacks. But you also read and you learned that each setback is an opportunity and that there's always optimism for the future. And while I may have had a -- suffered a personal setback last night, I couldn't be more optimistic about the future of this country.

I couldn't -- I'm honored that I have had the privilege to serve and represent the people of Virginia's 7th district. You know, people often lament what is wrong with this town. But I want to remind you of what's right. I've had the honor to serve with so many very distinguished colleagues. You know, these are the people who fly across the country every single week trying to do what they can to help their constituents live a better life. And these are members on both sides of the aisle.

I can tell you, I have been more than honored to serve as a part of the Republican conference and serve as their majority leader for last several years.

My colleagues and I are also admirably served by a tremendous group of staff who put tireless hours with the same noble intentions of trying to help the constituents of ours live a better life. These staffers are the backbone of this institution, and I'm proud to have gotten to know them and their families and actually call them part of my family.

I'd also like to recognize the sergeant at arms, the Capitol police, and in particular the Dignitary Protection Division, who I've come to know personally, and I've gotten to know their often unheralded services that really are second to none. And it's been an honor to be in their company.

It's especially been a privilege to get to know so many thousands, tens of thousands, of constituents of neighbors who make up the community of the greater Richmond area. You know, Richmond, Virginia is a special place that I've called home my entire life. And I know that some of you, my friends in the press corps, have joined me there recently. But I encourage everyone to make the visit soon.

We House Republicans have made some tremendous strides over the past few years. We fought to allow every child, regardless of their zip code, the ability to go to the school of their choice and to receive a quality education. We prioritize medical research and innovation and have led the way into an unprecedented area -- era of technology and its breakthrough. We've forced the reduction of spending in Washington in consecutive years for the first time since the Korean War. And we fought to protect people from losing their insurance or facing higher health care costs, due to Obamacare. We passed bill after bill that would increase take-home pay and reduce costs for working middle class American families. Now, some people think Washington gets nothing done. Well, there's a

stack of bills sitting in the Senate that shows House Republicans do get things done. We get a lot done. And our priority is building an America that works for the middle-class families who are struggling in this country.

But there is more work to do. Conservatives have solutions that can help alleviate the middle class squeeze and provide opportunity to all, regardless of their circumstance in life. And I will continue to fight for each and every American who's looking to better themselves and help their families pursuing the American dream. While I will not be on the ballot in November, I will be a champion for conservatives across the nation who are dedicated to preserving liberty and providing opportunity. Truly, what divides Republicans pales in comparison to what divides us as conservatives from the left and their Democratic Party.

I hope that all Republicans will put minor difference as side and help elect a Republican House and Senate so that we may all benefit from a proper check and balance that leaves our nation more secure, more prosperous and freer. The United States of America is the greatest gift to mankind, and I'm confident that our nation will overcome every struggle, exceed every challenge, and share the message of freedom, prosperity and happiness to all liberty-seeking people around the world for decades to come.

Now while I intend to serve out my term as a member of Congress from the 7th district of Virginia, effective July 31st, I will be stepping down as majority leader. It is with great humility that I do so, knowing the tremendous honor it has been to hold this position. And with that, I'm delighted to take some questions.

QUESTION: Mr. Cantor, why did you lose last night? And what can the party learn from your loss last night?

CANTOR: You know, I'm going to leave the political analysis to y'all. I know that my team worked incredibly, incredibly hard. They did a tremendous amount of work. I'm proud of their work. I'm grateful for what they did. And in the end, the voters close a different candidate. Dana?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Mr. Cantor, you're going to leave the political analysis to others, but you personally, I'm sure you've gone reflecting in the past 24 hours. Do you think that maybe you spent too much time here with your job as leader, tending to your rank and file, and not tending enough to your constituents back home?

CANTOR: I was in my district every week, so - you know, there's a balance between holding a leadership position and serving constituents at home. But never was there a day did I not put the constituents of the 7th district of Virginia first, and I will continue to do so. Joe (ph)?

QUESTION: Mr. Leader what message do you believe that this sends about the future of immigration reform? Should it be stopped at this point, or do you think it should go forward and would you -- what have you talked to Speaker Boehner about?

CANTOR: First of all what I would say, again, on the political piece of that, I'll let y'all do the analysis. But I will say that my position on immigration has not changed. It didn't change from before the election, during the election, or the way it is today.

You know, I have always said the system is broken, it needs reforms. I think it is much more desirable and frankly doable if we did it one step at a time, working towards where we have common ground and believe things in common. I don't believe in this "my way or the highway" approach that the president has laid out, and I've continued to take that position.

I have said there's common ground at the border, there's common ground. I would like to see the issue of the kids addressed by those that didn't break any laws and come here unbeknownst to them. So again, I've always said that there should be and is common ground if we would just allow ourselves to work together. Paul?

QUESTION: Who do you want to succeed you, and how divisive will the election be within your conference?

CANTOR: Well, I don't know who it is that will actually be running. I can tell you that if my dear friend and colleague Kevin McCarthy does decide to run, I think he'd make an outstanding majority leader. And I will be backing him with my full support.

QUESTION: I'm curious, a lot - a lot of focus has been on the politics side. But on the policy side, people are wondering what this means are some things like the export/import bank (ph) (INAUDIBLE) authorization. You touched on immigration and some other things going on. Is this sort of the end of the legislating of this Congress, or do you think this Congress can still get those big things done?

CANTOR: We've got, you know, obviously this month and next. We are very full on the floor with appropriations measure that my team and committees are working on. We have got CFTC authorization, we've got some energy bills that will speak to bringing down costs for Americans who are facing the summer driving season. We've got a full set of bills. We've probably got another group of human trafficking bills to be done. The chairman of the House Financial Services committee, I believe, has announced a markup on the Tria bill; we'll look to do that this summer. There's a lot of things in motion.

So, yes, we will continue to work and hopefully the Senate will reciprocate so that we can get the work of the American people done. Chad?

QUESTION: Can you talk for a minute about -- you know, they say politics is local here, you lost your race. A lot of people are going to try to read broader things into this here. But why shouldn't some Republicans be scared as they move into primaries where you say spent every week sometime in your district where they feel they have shored up their base and then they get a challenge? Why shouldn't somebody be running scared at this point after an unprecedented loss by a majority leader? CANTOR: Again, I think as you rightly suggest, all politics are local,

and there was obviously a lot of attention that was cast on our race. But again, I think that our members are in good position in their districts and again, I'll leave the political analysis of what happened to y'all.

(CROSSTALK)

QUESTION: Leader Cantor, Democrats said you were too extreme. Conservatives said you were too compromising. What advice do you have for your successor?

CANTOR: Maybe we had it right somewhere in the middle. But again, I -- you know I think that this town should be about trying to strike common ground. I've always said it's better if we can agree to disagree, but find areas in which we produce results.

I've said this before, Nancy, I've talked about my wife and I, almost married 25 years. And believe me we don't agree on everything. And we have managed to raise our family, have a wonderful marriage. She has stood besides me throughout this public office stuff. Been a strong advocate for me, and not always believing in everything that I believe in. But we've managed to raise our family and do well.

I don't think that's too unlike life. I don't think it's too unlike the legislative arena. I think more of that could probably be helpful. Deidre?

QUESTION: Mr. Cantor, what do you think your loss says about the party's direction for 2016? Some of your Republican colleagues are already saying that will only emboldens the Tea Party to elect a more conservative, uncompromising Republican candidate.

CANTOR: First of all, again, I'm going to leave the political analysis of what happened yesterday to y'all. I would say about the Tea Party, remember what the acronym means, Taxed Enough Already. All of us conservatives and Republicans believe in that. And when the Tea Party first came about in 2009, I believe it was largely in reaction to the tremendous overreach on the part of the Obama administration with the stimulus, Obamacare, Dodd/Frank, attempt at cap and trade in the House. And the country rose up and said, enough is enough.

So I do believe that what we have in common as Republicans is a tremendous amount of commitment to a better and smaller government and greater opportunity and growth for everybody. And the differences that we may have are slight and pale in comparison to the differences we have with the left and those expressing support for liberalism and more expansive government.

(CROSSTALK)

QUESTION: Can you -- if you have the elections on July -- I'm sorry, in June 19th, and you're stepping down July 31st, can you actually have a leadership in waiting that long? Or will that only create more (INAUDIBLE)?

CANTOR: Again, I think you'll have to speak to the speaker about the timing of the leadership elections. And I will say that we've got a very busy floor period. I've announced ever since the beginning of the year we've got a lot of on the floor. My team has been heavily involved with the committees and drafting legislation and make sure that we can run the floor and be expeditious in the legislative process. We look forward to a very productive June and July.

BASH: Follow-up, you don't want to do political analysis. What about personal analysis? I mean, did you kind look in the mirror before you went to sleep, if you went to sleep last night, and said, how did I let this happen?

CANTOR: No, because I really do believe we did everything we could. I'm very, very proud of my team on the ground in Richmond for all they did. There was a tremendous outpouring of support on all sides, and I, again -- I just came up short, and the voters elected another candidate.

(CROSSTALK)

QUESTION: What's next for you? What's next for you? What's your next move, sir? What do you think you'll be doing after you leave Congress?

CANTOR: Well, again, that is probably between my wife and me. And I will be looking at to see how I can best serve, how I can best be a part of what we really have been about here with the agenda called "an America that works." Remember what it's premised upon: the notion that conservative solutions of personal responsibility, limited government, more liberty, can produce the results and solve so many of the problems that the American people have been facing in an Obama economy under the Obama administration.

So thank you all very much.

QUESTION: You think you might run again in two years?

JAKE TAPPER, CNN HOST: House Majority Leader Eric Cantor, talking about his unprecedented loss in his primary last night to a Tea Party professor. We'll take a quick break and then back with some more analysis right after this.

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TAPPER: Welcome back to THE LEAD, y'all. I'm Jake Tapper following breaking political news. We just heard House Majority Leader Eric Cantor announce his plans to step down as House majority leader effective July 1st. After an historic primary loss to David Brat, all but unknown Tea Party challenger and professor of economics at Randolph-Macon University.

Let's bring back our political panel, Jenny Beth Martin, chair of the Tea Party Patriot Citizens Fund and Ross Douthat, CNN political commentator and columnist for "The Network Times." So Jenny Beth, I just want to start with you.

Congressman Cantor said that the differences between Republicans are relatively small compared to what separates Republicans from Democrats. I would think that you would disagree with that. You think there's some pretty big differences.

JENNY BETH MARTIN, CHAIRWOMAN, TEA PARTY PATRIOT CITIZENS FUND: I think the differences between the two should be large and I think that what we've seen is not large differences. We've seen debt ceilings that continue to increase, spending that conditions to increase, and in no -- no one who is leading the way saying here's how we're going to get to a debt-free future. Leadership talking about fixing Obamacare rather than appealing Obamacare. That's not what they want to see happen.

TAPPER: I mean that's -- polling would indicate that you're wrong, that actually like a plurality of Americans want to keep it and some want to fix it. You don't hold majority opinion to repeal Obamacare.

MARTIN: There are certainly more people who want to repeal Obamacare than want to see it in place. People are concerned because they're losing their health care, they don't know how much it's going to cost. We understand the quality of health care has decreased. Congress focused completely on immigration, and they're going we're going it flood the market with more workers when Americans can't even get jobs in America right now.

TAPPER: Ross, your thoughts on Congressman Cantor's swan song there?

ROSS DOUTHAT, CNN POLITICAL COMMENTATOR: I thought the swan song was gracious and you know, he seemed upbeat and positive, like a man who is about to probably make a lot of money in some other line of work that doesn't involve dealing with the media quite as much. And then to the question about Republicans, there are two possible scenarios.

One this is a doorway into a new round of Republican civil war that ends in another shutdown scenario and probably a Democrat, probably Hillary Clinton, being elected president in 2016. The other scenario is that some of the legitimate grievances that was raised against Cantor, just against the political leadership, will be actually addressed with a positive policy agenda. And that's sort of the solution the party needs. But you know --

TAPPER: Ross Douthat, Jenny Beth Martin, thank you so much, appreciate it. That's it for THE LEAD. I'm Jake Tapper. I now turn you over to Wolf Blitzer. He is right next door in "THE SITUATION ROOM" -- Mr. Blitzer.